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Rand takes beating as Gordhan drama deepens

Aug 24 2016 18:28
Carin Smith

Cape Town - The rand was a tragic victim on Wednesday, a day dominated by the continued unfolding of the drama between Finance Minister Pravin Gordhan and the Hawks.

By late afternoon the rand was down 4.91% at R14.24 to the dollar, down 4.23% at R16.02 to the euro and down 5.63% at R18.84 to the pound.

Gordhan was summoned by the Hawks to appear at their office on Thursday to obtain a warning statement. However, he said in a statement issued by Treasury that he had been advised that he is under no legal obligation to do this and will, therefore, not meet the Hawks.

Gordhan emphasised that he is not a suspect in the Hawks' investigation into certain Sars issues.

The Hawks want to meet with Gordhan and other former SA Revenue Service officials on Thursday to receive a letter of warning (which precedes an official charge) regarding an investigation unit set up when Gordhan was Sars commissioner from 1999 to 2009.

In a statement issued by Treasury on Wednesday afternoon, Gordhan said he has a job to do in a difficult economic environment and serve South Africa as best he can.

"Let me do my job," he implored.

Adam Phillips of Umkhulu Consulting told Fin24 the rand has been at the centre of currency movement on Wednesday.

More on Gordhan:

Rand takes beating as Gordhan drama deepens

Open letter to President Jacob Zuma: Hands off Gordhan

FULL STATEMENT: Why Gordhan won't meet the Hawks

"We have seen a stronger dollar on the back of the previous day’s good housing numbers, but operators are wary of Yellen’s speech at Jackson Hole on Friday. The pound had another good day and post Brexit data shows the economy is holding up well," said Phillips.

"Regarding the rand, I think most players have over played what tomorrow was going to bring. It could be a damp squip now, although that does not mean that this is the end of it. We could still see some movements either way which will make Nenegate look like positively tame. The movements will be very big and it won’t take much to push it around. It touched 14.2650, but is back at 14.17 now."

In his view, Gordhan came out on top again in his news conference on Wednesday afternoon.

"He won’t meet the Hawks tomorrow, but he has offered to assist. Clearly he believes he has not done anything wrong. He has stressed this so many times that you would think his attackers might take notice," said Phillips.

Listen to the clip by Gordhan declaring that he will not appear before the Hawks:

Read Fin24's top stories trending on Twitter:

pravin gordhan  |  markets  |  currencies  |  hawks  |  rand


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